Chapters 7-10

Question 1

All of the following are excluded under Part A of the Personal Auto Policy, except:

Damage caused by a vehicle designed mainly for off road use

Use of a non-owned vehicle without permission

A vehicle driven by an unlicensed driver

Intentional damage caused by the insured

Answer 1

A vehicle driven by an unlicensed driver

Question 2

A’ has BI of $49,500, ‘B’ $19,500, ‘C’ $14,000 clms in 1 accd. Insured PAP carries 25/50/10. What does the insurer pay?

Answer 2

$50,000

Question 3

Which policy is primary for B.I. for if a neighbor borrows the insured’s car and injures a pedestrian?

There is no coverage for this loss

The insured’s auto policy

The neighbor’s homeowners liability policy

The neighbor’s personal auto policy

Answer 3

The insured’s auto policy

Question 4

Which Statement is true regarding a Difference In Conditions Policy?

There is a pro rata clause

There is always a coinsurance clause

The standard deductible is $250

There is no standard form

Answer 4

There is no standard form

Question 5

All of the following are true of the Fine Arts Floater, except:

Coverage applies only to scheduled items

Coverage is written on a replacement cost basis

It covers such items as paintings, rare manuscripts and antiques

It has a 90-day automatic coverage for newly acquired items

Answer 5

Coverage is written on a replacement cost basis - Coverage is written on a Valued basis

Question 6

When would it be necessary for the insured to be required to pay a self-insured retention on an umbrella policy?

Answer 6

When the umbrella has to drop down to act as the primary policy

Question 7

Which of the following is not true of the Yacht Policy?

Is written on an Ocean Marine form

Lay up warranties are permitted

It provides coverage regardless of its territory

It includes both property and liability coverage

Answer 7

It provides coverage regardless of its territory

Question 8

Crop/Hail Insurance is a specialized policy that:

Answer 8

Protects against reduced yield due to covered loss before crop harvest

Question 9

True or False: a Musical Instrument on a Musical Instrument Floater increases in value if it’s played for remuneration during policy term

Answer 9

FALSE - Playing for remuneration (monies) is an exclusion and requires a separate line of coverage resulting in an additional premium

Question 10

NFIP with $500 deductible for dwelling/contents. Sustains flood damage to home & PP. What is max insured has to pay?

Answer 10

$1,000 - $500 deductible PER APPLICABLE LOSS

Question 11

PAP-50/100/25; DED=500//9.5k auto damage; 11k guardrail damage; 1k broken leg. Policy pays what?

Answer 11

$21,000

Question 12

Under Uninsured Motorist Coverage of the Personal Auto Policy, which of the following would be an insured?

The operator of an uninsured auto involved in an accident with the insured

The owner of an uninsured auto involved in an accident with the insured

A family member occupying an uninsured auto

A family member, occupying an insured auto struck by an uninsured vehicle

Answer 12

A family member, occupying an insured auto struck by an uninsured vehicle

Question 13

Inland Marine Insurance is not typically used to insure which type of property?

Answer 13

Autos

Question 14

All of the following are false concerning the National Flood Insurance Program, except:

Dwelling coverage includes trees, shrubs, and plants

Payment for losses are made by the federal government

Flood policies are available only from the National Flood Insurance Program

Agents bind flood insurance up to 15 days prior to submitting the final app

Answer 14

Payment for losses are made by the federal government

Question 15

Choose the false statement regarding Flood Insurance.

Coverage is provided for damage to growing crops

Coverage is not provided for indirect loss

Areas must have established and approved a flood control plan

Damage to money and securities is excluded

Answer 15

Coverage is provided for damage to growing crops

Question 16

True or False: Under a Personal Auto Policy, an auto can be used to transport goods for monetary gain

Answer 16

True - It may be used to transport goods for hire if receipts are less than $1,000

Question 17

Under Part D - Coverage for Damage to Your Auto of the Personal Auto Policy, vehicle upset would be covered under:

Collision

Comprehensive

Other than Collision

Transportation Expenses

Answer 17

Collision

Question 18

Covers business exposures of motor carriers for hire who transport the goods of others

Answer 18

Truckers Coverage Form

Question 19

A business, individual, or organization that, for a fee, carries persons or property that are or belong to the general public from one place to another

Answer 19

Common carrier

Question 20

Covers business exposures due to the transportation of goods owned by others for hire and the transportation of their own property

Answer 20

Motor Carrier Coverage Form

Question 21

This endorsement is used to add family members to the definition of “insured” under any of the auto coverage forms. It also eliminates the fellow employee exclusion for bodily injury to the employees of the named insured or any family member.

Answer 21

Individual Named Insured

Question 22

This is an endorsement that allows mobile equipment such as bulldozers, forklifts, and road construction equipment to be considered covered autos. This type of equipment is not normally covered, except for liability arising while being carried or towed by a covered auto.

Answer 22

Mobile Equipment

Question 23

This endorsement may be added to any of the auto coverage forms and is designed for individuals who do not personally own and insure an auto. It provides coverage for liability, auto medical payments, comprehensive, collision, uninsured motorists, and underinsured motorists—if a limit of liability and premium is shown on the endorsement’s schedule.

Answer 23

Drive Other Car – Broadened Coverage for Named Individuals